Question

Rearrange the following steps in the accounting cycle in proper sequence: a. A post-closing trial balance is prepared. 3 b. Adjustment data are asssembled and analyzed. c. Adjusting entries are journalized and posted to the ledger. d. An adjusted trial balance is prepared. e. An optional end-of-period spreadsheet is prepared. f. An unadjusted trial balance is prepared. g. Closing entries are journalized and posted to the ledger. h. Financial statements are prepared. i. Transactions are analyzed and recorded in the journal. j. Transactions are posted to the ledger.

Answer 1

The Accounting Cycle of a Business refers to the entire process of accounting for the transactions in the business from the moment the company begins a new transaction to the end of the period where it is aggregated into other accounts and presented to relevant stakeholders.

There are 10 steps to this cycle and they are;

1. Transactions are analyzed and recorded in the journal.
2. Transactions are posted to the ledger
3. An unadjusted trial balance is prepared
4. Adjustment data are assembled and analyzed
5. An optional end-of-period spreadsheet is prepared
6. Adjusting entries are journalized and posted to the ledger
7. An adjusted trial balance is prepared
8. Financial statements are prepared
9. Closing entries are journalized and posted to the ledger
10. A post-closing trial balance is prepared

i ⇒ j ⇒ f ⇒ b ⇒ e ⇒ c ⇒ d ⇒ h ⇒ g ⇒ a